Spill claimants may get second chance

By Emily Pickrell |
November 14, 2012

U.S. District Judge Carl Barbier of New Orleans poses in this undated handout photo released to the media on Thursday, Feb. 23, 2012. How much BP Plc will pay for the 2010 explosion of a Gulf of Mexico oil rig that killed 11 people and caused the largest offshore spill in U.S. history may rest in the hands of Barbier, a former maritime lawyer who began his career representing sailors in personal-injury cases. Source: Office of Judge Barbier via Bloomberg EDITOR'S NOTE. NO SALES. EDITORIAL USE ONLY.

Photo By Dave Martin/FRE

FILE - In a Saturday, June 12, 2010 file photo, crude oil from the Deepwater Horizon oil spill washes ashore in Orange Beach, Ala. BP agreed late Friday March 2, 2012 to settle lawsuits brought by more than 100,000 fishermen who lost work, cleanup workers who got sick and others who claimed harm from the oil giant's 2010 Gulf of Mexico disaster, the worst offshore oil spill in the nation's history. The momentous settlement will have no cap to compensate the plaintiffs, though BP PLC estimated it would have to pay out about $7.8 billion, making it one of the largest class-action settlements ever. After the Exxon Valdez disaster in 1989, the company ultimately settled with the U.S. government for $1 billion, which would be about $1.8 billion today. (AP Photo/Dave Martin, File)

Photo By Motley Rice LLC

Joe Rice, a lawyer on the Plaintiffs' Steering Committee that negotiated a settlement with BP over the 2010 Gulf of Mexico oil spill.

BP and some plaintiffs' lawyers in the litigation over the 2010 Gulf oil spill are asking a federal judge to give claimants who asked to leave a proposed class-action settlement another chance to participate.

The British oil company and the Plaintiffs' Steering Committee, a court-appointed group of attorneys representing private claimants, asked U.S. District Judge Carl Barbier of New Orleans to give claimants until Dec. 15 to revoke requests to opt out of the proposed settlement, according to a Wednesday morning filing.

BP and the committee said in the filings that their request is in response to individual plaintiffs' attorneys who want to revoke some of the opt-out requests they filed on behalf of clients.

The deadline was Nov. 1 for opting out of the settlement and Nov. 5 for revoking opt-out requests. The motion Wednesday doesn't ask Barbier to re-open the opt-out period, but to extend the deadline for opting back in.

The settlement, proposed earlier this year by BP and the Steering Committee, could resolve claims against BP by 100,000-plus Gulf Coast residents who suffered economic or health damages when BP's Macondo well blew out, spilling millions of barrels of oil that decimated coastal fishing, tourism and other businesses.

The deal requires Barbier's approval, and he signaled at a hearing last Thursday that he's inclined to approve it.

Claimants who did not opt out by Nov. 1 are bound by the terms of the settlement, which BP has estimated will total $7.8 billion, although the proposed deal sets no cap on damages.

Court-supervised claims administrator Patrick Juneau reported at the hearing last week that 25,000 prospective claimants had filed to opt out.

Juneau estimated that about half of these opt-out requests met the court requirements, which include a valid claimant signature and an address.

Plaintiff Steering Committee attorney Joe Rice estimated this week that only about 6,000 opt-outs currently meet the court's requirements.

At the hearing, Barbier noted that some attorneys had tried to opt out a large number of potential claimants.

"I am greatly concerned about some counsel who have attempted to or encouraged their clients to participate in en masse opt-outs," Barbier said. "I think a lawyer owes a fiduciary duty or an ethical duty to analyze each client's claim and inform the client to let them make a claim. To just send form letters to thousands of clients and say, 'We don't like this settlement,' without further analysis, is not serving your client well, at the least. Those who do opt out, you have to consider that when you opt out of the settlement, what are you opting in to? You are giving up payment now for years of litigation and delays."

Houston lawyer Brent Coon, who estimated that about 10,000 of his 15,000 spill clients had opted out, welcomed the prospect of a time extension, saying many of his clients opted out because they didn't know what they would receive in the settlement.

"Our goal is just to make sure our clients get paid and are not subject to the whims of an adjustor who doesn't understand the math or had a bad day," he said.

The opt-out deadline fell before most prospective claimants received settlement offers. While many legal experts say that is standard procedure in a class-action settlement, Coon and other plaintiff attorneys have said the complex nature and high value of many of the business claims make more information necessary for claimants to weigh their options.

"We are not intimidated by the process," Coon said. "I wish they would have extended the date by a much longer amount."